The 30-year fixed rate mortgage has become more and more popular over the last few months as homeowners are looking to refinance for a lower mortgage rate in the hopes of getting a lower mortgage payment. Many homeowners refinanced to an almost record low mortgage rate and locked in that rate on their 30-year mortgage.
While interest rates have risen slightly, they remain around 5%, which for many homeowners is a great deal when looking for a home loan mortgage rate that is going to beat their current rate.
Mortgage interest rates around 5% will, for many homeowners bring a lower monthly mortgage payment when they refinance, but also, homeowners with equity built up in their home may get money back when they refinance.
There is no law as to what one should do with money received from refinancing, but more financially minded homeowners have been using their money from their refinance to pay down on their mortgage principal.
Homeowners that are considering financing are being told by mortgage advisors to look at their options and what it would entail to refinance their home, making sure it is the right move for them, financially, before proceeding.